White label products, when managed appropriately, are a cost-effective alternative for clients, says More Rosh & Waters’ Clint Waters.
This week, Firstmac managing director Kim Cannon said brokers are too focused on income and warned that the broking industry may be headed down the path of the financial planning industry.
While Waters accepts that it’s possible some brokers use white label products to their own financial advantage, he says he isn’t personally aware of any that do and that the cost benefits for consumers far outweigh any potential risk.
“I think the perceived value [of white labelling] is price, so our lending product is distributed on the base that it’s essentially a wholesale product. It may lack a couple of bells and whistles, but, generally speaking, we’ve got very good communication with the lender.”
Waters says his white label product has no controls on margin, which he says is key.
“I don’t think that as a broker it’s up to us to manufacture a product. We should be given a level of products that compares apples with apples.”